Legislative Help

By admin | July 8, 2008

Many homeowners are beyond help so says Treasury Secretary Henry Paulson. Foreclosure will occur in the foreseeable future for many homeowners as high housing prices and shady lending practices allowed for many of these individuals to purchase homes that they could not afford.

“Many of today’s unusually high number of foreclosures are not preventable,” he said in prepared remarks to a mortgage-lending forum meeting in Arlington, Va. “There is little public policy-makers can, or should, do to compensate for untenable financial decisions.”

It is estimated that 2.5 million homes will begin the process of being foreclosed when is all said and done. The Bush administration has been focused on reducing the number of foreclosures with the lending companies and is tring to salvage what they can of the forecloser cases.

According to Paulson, there have been 1.7 million homeowners helped since July 2007. Congress is currently working on a bill that will allow for the FHA to provide cheaper mortgages to help even more homeowners keep their home.

However legislative differences between the House and Senate could prevent a timely passage. Similarly the White House has said it would veto any bill that comes through its office.

“We haven’t waited for Congress,” Housing and Urban Development Secretary Steve Preston told reporters.

Preston said he was concerned that the Senate’s foreclosure rescue would block the FHA from charging riskier borrowers higher premiums and that the House plan would require the agency to insure mortgages in which the down payment is paid by the seller. Both moves could mean big losses for the FHA, he said.

“Taxpayers should not have to absorb preventable, foreseeable losses,” Preston said.

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